Lt Governor Najeeb Jung today approved the power subsidy of up to Rs 1.20 per unit which will benefit around 84 per cent or 28 lakh of the total electricity consumers in the city.
Delhi's Power Secretary Arun Goel said the subsidy will be effective from August 11 when the Delhi Budget was approved by the Centre.
The subsidy was announced by Union Finance Minister Arun Jaitley while presenting the Delhi budget in Parliament on July 18 as the city is under President's Rule.
The monthly subsidy will be Rs 1.20 per unit for consumption up to 200 units and Rs 0.80 for consumption between 201 and 400 units.
The government will have to incur an additional expenditure of Rs 260 crore up to March 31, 2015 on account of the subsidy.
Goel said all the private power distribution companies have been told to implement the subsidy scheme with immediate effect.
The power tariff in the city was hiked by up to 7.5 per cent for domestic consumers in July by Delhi Electricity Regulatory Commission.
Though rates were increased, the regulator said the bills of consumers whose monthly consumption does not exceed 800 units would actually go down as Power Purchase Adjustment Cost (PPAC) surcharge of 6-8 per cent was withdrawn for the next three months.
After the subsidy is effected, the per unit rate for consumption up to 200 units will come down to Rs 2.80 instead of current Rs 4.
The per unit rate between 201 and 400 units will be Rs 5.15 as against Rs 5.95 per unit announced by DERC.
The regulator had increased per unit rate in the 0-200 slab from Rs 3.90 to Rs 4 and in the 201-400 slab, it was hiked to Rs 5.95 from 5.80.
Goel said the subsidy scheme will benefit around 84 per cent of around 33 lakh consumers.
The Sheila Dikshit government had introduced the subsidy of Rs 1 per unit for consumption between 0-200 units and 200-400 units five years ago.
Keeping a pre-poll promise, AAP government had provided 50 per cent subsidy on electricity consumption of up to 400 units after coming to power. The subsidy scheme had lapsed on March 31.